A national migration is currently changing the face of rural America, and with it, the demographics of South-Central Missouri. Across the nation an increasing number of people are moving from large metro areas into interior rural communities. Competition for local real estate is resultingly as active as ever known, with some residential property values the highest yet recorded. Issues such as remote capabilities, social factors, economics and the vitalness of one’s personal identity are fueling the population shift. The full impact of these changes for the Ozarks, and the United States, only history will reveal.
High demand, high values
“I don’t think in my 35 years of being a realtor that I have ever seen this kind of activity, honestly,” says Karen Lewis of VIP Properties in Salem. “Once you list them, they are gone. Sometimes in the past two months it is within two days it’s under contract. With that, we’re also now having bidding wars.”
Lewis is one of several realtors interviewed by Salem Publishing Company, publisher of The Salem News and Phelps County Focus, over the past month on the status of the local real estate market. A common theme of the conversations was the increasingly rapid pace of transactions.
“You list a piece of property and within two days you have multiple offers,” says Beth Frizzell of Century 21. “Some people have the ability to pay cash, and they’re offering more money than what the property is listed at. That’s something that we have never really seen here, but we are seeing it now.”
Babette Wells of United Country in Salem agrees.
“One property we had was listed at noon Wednesday, and by Friday, it had 13 offers,” she says.
Of the market, estimates by realtors ranged from out-of-state buyers being approximately 40% of purchases over the past year to around two-thirds of that total.
“We usually deal with a lot of out-of-state buyers anyway, but it’s definitely tripled this year,” says Jenna Deason of Living the Dream Outdoor Properties, which sells property across the Ozarks. “We also have a lot coming from St. Louis and within Missouri. We have a lot of them coming just wanting to get into the rural areas. They want to get away.”
Demographically, the realtors say buyers have been a mix of people. Some are retirees wanting land on which to live and invest. Others are younger and hope to raise families in a countryside setting. In some cases, buyers still reside in regional metros but want a second home.
The reasons why the buyers have come are varied.
“I think it’s the lifestyle we live here,” Frizzell says. “We are slower paced. The cost of living here is not as great. Overall, I think people are getting tired of the rat race. I don’t want to make it political, I really don’t, but politics plays a huge role in a lot of things. I just feel a lot of people are looking for someplace that’s just not so quite in your face.”
Mike Woessner of Rolla-based Investment Realty says personal politics have been an explicit motivation for many.
“They are coming to this area, and other Midwestern areas, and what they’re telling us is they’re just sick and tired of the unrest in in these major cities,” Woessner says. “I was visiting with the guy from New Jersey a month ago. He was just kind of touring small towns in our state. He told me, ‘Mike, where I live, it doesn’t even feel like America anymore.’ He said it has turned so upside down.”
However, Deason says not all the new arrivals are directly from urban areas. Missouri is also seeing the secondary effect of a previous migration.
“I’ve had a lot of people from Idaho moving here,” Deason says. “A lot of the California people are moving to Idaho, and the Idaho people are moving here. We also have California people moving here wanting to get away from all of the politics. They want to come to somewhere a little more relaxed.”
Welcome to Missouri
For Karinda Hoover and her family, the experience of COVID-19 in southern California was a turning point.
“For us, it was the domino that tipped it,” she says. “We knew things were going on politically in our state that weren’t good for freedom. COVID really put a spotlight on it. We felt it was no longer a good place to raise children, and for our kids to raise their children. That said, what also really won us over here is how beautiful and peaceful it is.”
Hoover and her husband didn’t know anyone in Missouri, but they are now joined by their daughter in a neighboring home, and soon, their son will also move to Dent County in the Ozarks.
“Since we’ve gotten here a lot of our friends are coming,” Hoover says. “My husband’s best friend will be out here in September. He’s looking for a house and will be here only part of the year because he has a home in Alaska. Our daughter’s best friend is also trying to transfer here. He’s with the (U.S.) Forest Service.”
The Hoover family and their friends are one example of a growing migration of people into the Ozarks and other rural parts of the country.
“We did look at other states. We looked at South Dakota, but nothing hit,” Hoover says. “Then we found Missouri and we really liked it. It is so beautiful here. As far as housing, it is cheaper to afford space between your neighbors. Cost of living-wise, the prices for everything are the same here.”
Jason Praizner is another Californian moving to Missouri. He, his wife, son and daughter-in-law will be taking up residence near Preston in Hickory County.
“I retire in six weeks, and I couldn’t retire in California. I’d have to get another job and work full time to make it, and I don’t want to do that,” Praizner says. “We were originally going to go to Idaho, but everybody from California went there and the prices skyrocketed. The house we were looking at a year ago is now out of our reach.”
Praizner had never been to Missouri before.
“There is more and more taxation in California and the policies are ridiculous. They make zero sense,” Praizner says. “I have one friend who lives here in Lynchburg and she convinced me to come look around last March. We stayed in Lebanon last time and decided to buy anywhere within one hour of there. No matter where we went, it was perfect. Everyone has been super friendly. It feels like home.”
Another retiree moving to rural Missouri is John Freeman. He is relocating to rural Dent County from Granite City, Illinois.
“I think things are too crazy,” he says of St. Louis’s Metro East. “There is crime and shootings, all that stuff going on in the world. Down here, I’ve never felt more free and happy as I do now.”
Speaking on behalf of the new arrivals, Freeman says he isn’t coming with an ambition to change the Ozarks so much as wanting the Ozarks to change his way of life.
“I like to go fishing and hunting. I can target practice in my backyard. That’s a plus to me,” he says. “I don’t like the city. Too many people and everybody is rude. When you come down here everybody is so friendly it’s unbelievable. When you pass people on the road, they wave to you. I remember when I opened my bank account at Progressive Ozark Bank (Salem), as I sat there, I noticed everybody who walked in knew everyone’s name. That seemed so cool to me.”
The real estate market has boomed to the benefit of sellers. However, some locals are finding their path to home ownership that much more difficult. Increasing prices, competitive bidding, and a growing demand on a limited housing supply has led to frustration for those hoping to reach life’s next milestone.
“It’s unaffordable,” says Derek Freeman, a public-school teacher from Dent County who lives in Rolla and works in Salem. Freeman says he’d like to embrace the homesteading lifestyle in his native Ozarks.
“I’m working at the school in Salem and thought I may be around here awhile so let’s look at buying a house,” he says. During his search, Freeman found a house he liked and even already knew the owners. However, upon looking for financing, was told he couldn’t be approved for a loan large enough to cover its market value due to his student-loan debt.
“I’ve almost completely ridden myself of thinking on that topic,” Freeman says of homeownership. “I’ve given up on the traditional school/work/homeownership idea. I’ve been trying to save, as minimal as it’s been, for getting an RV or an old bus to have renovated.”
For now, Freeman is renting a house with two roommates in similar circumstances.
“There is no way I could survive by myself with the paycheck I have without somebody else to help paying the bills,” Freeman says. “This all has exacerbated my frustration towards even trying to approach buying a house, or going through any of that loan process.”
Outside of the real estate market the housing boom is already having an economic impact on the wider community. The Phelps County Assessor’s Office announced earlier this year that given the rising property values, residential appraisals in the Rolla and St. James school districts would be elevated this year, 15% in Rolla, and 10% in St. James. With those rates, property tax collections may also potentially increase if tax levies aren’t rolled back. Such a property tax increase would inevitably impact not only property owners, but renters, too.
“If property taxes go up, rents will have to go up. It’s just a matter of basic economics,” says Woessner, of Investment Realty. “If landlords are going to be paying more expenses to operate their properties, they are going to have to compensate that by raising rents. … This affects everybody, not just young people. When prices go up, and rents go up because values have gone up, and expenses have gone up, it literally affects everybody.”
Woessner says those looking to blame out-of-state buyers for the rising prices should instead focus on interest rates.
“Interest rates took a dramatic drop during the COVID/vaccine period,” Woessner says. “We were seeing rates as low as 2.25%. That really spurred a lot of additional interest, a lot of additional activity, not only here but basically across the country.
“When you drop interest to 2.25% all of a sudden that person that could only afford a $150,000 house can now afford a $200,000 house or somewhere in that range. That is what has caused a majority of the interest in the market, and the and prices being pushed up.”
The mean center of population in the United States is currently in Wright County, Missouri, nine miles north of Hartville. That spot represents the point on the map where an equal number of Americans exist to the north, south, east and west.
The 2020 mean center is also about 40 or so miles southwest of its 2000 spot outside Phelps County’s Edgar Springs, meaning the US population overall shifted over those two decades to western and southern states. It was no surprise. The mean center of US population has moved west after every census since 1790, and to the south since 1920.
Will the 2030 mean center once again trend southwest? Or will that centuries-old trend see its first break?
“A lot depends on whether this country comes together or not,” Woessner says. “Under the current state, in my opinion, I think we’re going to continue to see an influx of people coming to our area and other rural areas looking for a better quality of life. I think the growth here is pretty much unlimited at this point.”
Woessner adds much will also depend on decisions made outside Missouri.
“Interest rates now have gone up from the 2.25% up to as high as 3.85% right now,” he says. “We’re starting to see a little bit of softening. I mean, 3.85% is still a great rate, much lower than it was several years ago. We’re still seeing strong activity, but we’re also seeing just a little bit of softening as those rates creep up.”
“The real question is, with the inflation the federal government is not talking about obviously going up, at what point does the Federal Reserve start to put more pressure on the economy by raising interest rates to kind of slow that down. That is basically unknown. In my opinion, as long as interest rates stay below the 4% mark, I think we will see a continued interest and activity in the residential side of the business.”
In the meantime, another question is, will the Ozarks see an exodus of native property seekers priced out of the local market like in Idaho?
“If I had the resources, as in being financially established enough to make that leap, I definitely would,” Freeman says of potentially leaving Missouri. “If the choice is between being a lifelong renter here, or being able to have my own land and raise a family someplace else, then I am going to leave.”
Originally Appeared Here